11) If a bank reconciliation includes interest revenue, a journal entry is required which credits Cash and debits Interest Revenue.
12) In a bank reconciliation, a book error will be shown on the bank side of the reconciliation.
13) In a bank reconciliation, outstanding checks will be shown on the bank side of the reconciliation.
14) In a bank reconciliation, a deposit in transit will be shown on the bank side of the reconciliation.
15) In a bank reconciliation, a NSF check will be shown on the book side of the reconciliation.
16) The difference that arises between the balance on the bank statement and the balance on the company's books because of a time lag in recording transactions is known as a permanent difference.
17) Which of the following is the most basic internal control measure for cash?
A) keeping money in a bank account
B) checking for counterfeit bills
C) counting cash receipts twice
D) internal audit of cash procedures
18) A deposit receipt is:
A) retained by the customer as proof of a deposit transaction.
B) the same as a signature card.
C) used by the bank as an alternative to a remittance advice.
D) given by the customer to the bank as a proof of deposit.
19) Which one of the following is true of a signature card?
A) It shows each authorized person's signature for a bank account.
B) It is the same as a deposit receipt and acts as a proof of the deposit transaction.
C) It must be signed by a banking authority for a checking account at a bank.
D) It can only be used for bank accounts of individuals not for the bank accounts of businesses.
20) When a check is issued, the party being paid the cash is referred to as the ________.
A) payee
B) maker
C) bank signatory
D) depositor
